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A rising wedge is certainly NOT a continuation pattern. It is the most
vicious of all reversal patterns. You are confusing the rising wedge with a
rising triangle. The normal rising wedge wipes out at least the whole of
the wedge gains in about one third of the time taken to form the wedge.
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> From: Chip Anderson <chipamy@xxxxxxxxx>
> To: meyer@xxxxxxxxxxx; Dr C. Roffey <roffey@xxxxxxxxxxxxxx>
> Cc: metastock-list@xxxxxxxxxxxxx
> Subject: Re: Dow Jones et al
> Date: Thursday, December 04, 1997 6:06 PM
>
> Hi Harley,
>
> A rising wedge is a triangle pattern formed when an up-trendline
> (drawn by connecting successive bottoms) intersects (or appears like
> it will intersect) a trendline connecting successive tops and the
> intersection point is higher than the triangle's midpoint. Rising
> wedges are traditionally interpreted as a "continuation pattern"
> meaning that prices should continue higher at or just before the
> trendlines meet.
>
> You can see this using the DJIA chart at
> http://coolhistory.com/ChipsCharts/Markets - I've drawn the red
> trendline connecting the tops and its easy to imagine the trendline
> connecting the bottoms.
>
> FWIW, Triangles and wedges are the most common charting patterns and
> are _very_ easy to get wrong. I _never_ trust them unless there is
> confirming volume pattern (the volume within a triangle should be
> falling as the triangle continues to form). Thus, unless they supply
> actual volume numbers, I never apply triangle analysis to indices. On
> other thing to keep in mind is that people often draw triangles with
> 2-point trendlines instead of the much more reliable 3-point trendlines.
>
> Hope this helps,
> Chip
> http://coolhistory.com/ChipsCharts
>
>
> ---Harley Meyer <meyer@xxxxxxxxxxx> wrote:
> >
> > In the spirit of learning can some one send a .gif to show me what a
> > rising wedge is. Maybe a couple of .gifs to show a couple of
> examples. I
> > have heard this mentioned occasionally and still don't what what it
> is.
> > Same goes for some of the triangle analysis mentioned in the past.
> > Harley
> >
> > Dr C. Roffey wrote:
> >
> > > Be Careful. The DJIA and the S&P are both at the top of rising wedge
> > > patterns. If the S&P breaks below 950 ... watch out.
> > > The UK FT 100 is in the process of forming a right shoulder for a
> Head
> > > &
> > > Shoulders top. The Nikkei is nearly finished its technical rally. It
> > > may
> > > try to test 17500 but the next major move is downside.
> > > I am not a happy chappy with these markets.
> > > Regards
> > > Dr Clive Roffey
> >
> >
> >
> >
>
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